Legislators consider how to launch a marijuana industry

As state lawmakers try to get Maryland's medical marijuana program off the ground, the focus has turned to the practical matter of establishing an industry to provide the drug — and the details are proving daunting.

While there is broad agreement in Annapolis that marijuana should be widely available for patients who need it, there's no consensus about how best to accomplish that end.

Legislators are hearing from frustrated patients and their families who still can't get marijuana legally to treat intractable pain, seizures and other medical problems. They're also being buttonholed by lobbyists representing people hoping to get in on the ground floor of what has proven in other states to be an extremely lucrative market.

The challenge is to devise a plan that would encourage entrepreneurs to become growers and distributors — while allowing enough competition to keep prices down for the consumer.

Last year, the General Assembly made it legal for the state's academic medical centers to dispense medical marijuana. But the hospitals have not moved to do so, prompting lawmakers to consider authorizing physicians on staff or affiliated with hospitals to, in effect, prescribe it.

Legislation passed by the House of Delegates would do that. But it has raised other concerns about creating a cartel of sorts, with a relatively small clutch of businesses holding exclusive rights to grow and sell the drug throughout the state. The House bill calls for awarding 10 licenses to cultivate and dispense marijuana. The licenses would run for five years initially, with an option renew them for another decade.

Some say that's a prescription for trouble. They worry that limiting the number of growers could restrict the supply and boost the price of the drug, making it hard to get in some places and unaffordable to poor patients.

"The poor guy in the city with HIV is not going to be able to avail himself of the drug because he can't afford it," predicted Sen. Bobby A. Zirkin, a Baltimore County Democrat. "I do not think we should be setting up a monopoly, whether it's five, 10 or 25 [growers]," he told colleagues on the Judicial Proceedings Committee on Thursday.

"Let the market decide," Zirkin said, urging panel members to authorize an unlimited number of growers and dispensers.

Some also worry that awarding lengthy licenses would handicap regulators dealing with any problems that may surface with startup operations.

"Doctors have to be relicensed every two years," noted Dr. Paul Davies, chairman of the state Medical Marijuana Commission and head of an Annapolis pain management practice. Having a shorter license term would enable regulators to keep closer tabs on growers and distributors, he said.

Twelve of the 20 states plus the District of Columbia that have allowed for medical use of marijuana require growers to be licensed every year or two, according to state health officials.

Advocates of the House plan say limiting the number of growers would help ensure there would be demand for their product.

"When people throw out the term 'monopoly,' I think that's not fair," said Del. Dan K. Morhaim, a Baltimore County Democrat and one of the architects of the House bill. The state needs to give new businesses stability if it wants them to take a risk on a brand-new industry that is at odds with federal drug laws, he said.

Having the growers act as distributors would prevent another layer of bureaucracy, Morhaim said

"The legislation can always be adjusted," said Morhaim, a physician. "People can make decisions informed by fact, not by speculation. In a year or two, we're all flexible."

But others worry that if the state's not careful, it could be making a small number of business owners very rich while not ensuring that everyone who needs medical marijuana in Maryland can get it.

"Overnight we're going to create millionaires," predicted Sen. Christopher B. Shank, a Washington County Republican. He said capping the number of licenses would make them extremely valuable.

"There's big money in marijuana," said Sen. Lisa A. Gladden, a Baltimore Democrat, who said there are lobbyists in Annapolis representing growers in Colorado interested in getting into the Maryland industry.

"I'm just amazed that they would come here," she added.

Sen. Jamie Raskin, sponsor of the Senate legislation, said he's not surprised the medical marijuana program has also attracted a grower's lobby.

"This is America, and people want to make money however they can," said Raskin, a Montgomery County Democrat.

Lobbyist J. Darrell Carrington said he's representing a local firm looking to get into the business.

"This is a brand-new industry, and you're creating it from scratch," Carrington said. He urged lawmakers not to fret about the length of licenses, saying regulators can always revoke them at any time for cause. The reason to start small, he said, is to ensure a smooth startup

"You want to make sure you don't oversaturate a market that hasn't been created yet," he said. "The state needs to be very deliberate, so that the businesses that start out have an opportunity to be successful."

Sen. Jennie M. Forehand, a Montgomery County Democrat, said she wanted to give state health officials some discretion on issues like licensing.

"Otherwise it's the Wild West," she said.

Members of the Judicial Proceedings Committee spent about an hour Thursday grappling with how many businesses to license, for how long and under what circumstances. But the complications and disagreements mounted, until the chairman, Sen. Brian E. Frosh, set up a work group to wade through the details and report back with a set of recommendations next week.

Any differences between a House and Senate proposal would have to resolved if a bill is to pass.

For Gail Rand of Annapolis, legislative gridlock is not an option. Her 41/2-year-old son, Logan, suffers daily seizures, and his doctors have said they think his condition might be helped by a type of medical marijuana. She's read about a Colorado boy who's been seizure-free since taking the drug, and is anxious for her son to have the same opportunity.

Rand said she has no advice to offer on the economics of establishing the medical marijuana industry, but she hopes lawmakers leave many of the decisions up to the state commission, so it can adjust as circumstances dictate. Her biggest fear, she said, is that debate will bog down and nothing will change.

"We need to get this passed this year," she said. "These kids cannot wait another year."

With an eye toward women voters, Democratic gubernatorial candidate Heather R. Mizeur called Thursday for Maryland to provide paid leave for workers who need time off to care for children or ailing relatives.